State Income Tax Definition

Income tax levied by individual U.S. states based on earned income. States use these funds for education, health care, and other needs. Not all states have a state income tax, and the percentage rates vary.

State Income Tax Extended Definition
Like federal income tax, state income tax is a payroll liability deducted from an employee’s paycheck. Employers must remit this liability according to the required time frame for their business.

Related Article
An Overview of State Income Tax

Last Updated By

Rachel Blakely-Gray | May 01, 2023